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Goodness, it's not just the recession that's coming to an end (see all those reports of green shoots); even the housing market is now poised for recovery, says Taylor Wimpey. We paraphrase, of course, but Britain's biggest housebuilder sounded more optimistic yesterday than at any time since house prices first went into freefall.

Those with a tendency towards cynicism will say that if you're in the housing business, talking up the market's prospects is in your interests. Still, in Taylor Wimpey's defence, it does have some real numbers to back up its accounts of stabilisation, including a sharp increase in its forward orders.

Even so, it is difficult to share the builder's optimism. Not because of suspicions about its motives, but because the fundamentals are heading in the wrong direction.

No one, for example, seriously thinks unemployment is likely to stop rising for at least another year. That means more personal debt, including additional mortgage arrears, greater numbers of distressed sales and an increase in repossessions. None of which will act as a brake on house price falls.

Even discounting that argument â€“ let's assume for a moment that prices have fallen so far that economic fears are now discounted â€“ where are all the buyers going to come from? There may well be people out there who want to buy property. Their ranks may even be swelling. Unfortunately, however, the mortgage finance isn't there for many of them.

The report on lending trends published by the Bank of England on Thursday made that abundantly clear. Just to remind you, it warned there has been almost no increase in the number of mortgages available at higher loans-to-value, and that the cost of home loans is increasing.

No wonder that the Council of Mortgage Lenders' figures show that mortgage lending actually fell back in May compared to the previous month. That reflects lower remortgaging activity, but also the fact that what increases we have seen in mortgage approvals for home purchases recently have been exceptionally modest.

Home loan providers are increasingly risk-averse, which is understandable given their realistic fears about bad debt. Whatever political pressure is brought to bear on lenders, including those with the taxpayer on their share registers, the supply of mortgage finance isn't likely to ease any time soon.

For that reason, it is hard to see any sustained recovery in the housing market for some time yet. The worst of the falls may be over, though plenty of analysts would not even be that optimistic, and we may see the odd month of house price rises (there have already been several, according to Nationwide and Halifax), but the storm has not yet passed over.

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Goodness, it's not just the recession that's coming to an end (see all those reports of green shoots); even the housing market is now poised for recovery, says Taylor Wimpey. We paraphrase, of course, but Britain's biggest housebuilder sounded more optimistic yesterday than at any time since house prices first went into freefall.

Those with a tendency towards cynicism will say that if you're in the housing business, talking up the market's prospects is in your interests. Still, in Taylor Wimpey's defence, it does have some real numbers to back up its accounts of stabilisation, including a sharp increase in its forward orders.

Even so, it is difficult to share the builder's optimism. Not because of suspicions about its motives, but because the fundamentals are heading in the wrong direction.

No one, for example, seriously thinks unemployment is likely to stop rising for at least another year. That means more personal debt, including additional mortgage arrears, greater numbers of distressed sales and an increase in repossessions. None of which will act as a brake on house price falls.

Even discounting that argument â€“ let's assume for a moment that prices have fallen so far that economic fears are now discounted â€“ where are all the buyers going to come from? There may well be people out there who want to buy property. Their ranks may even be swelling. Unfortunately, however, the mortgage finance isn't there for many of them.

The report on lending trends published by the Bank of England on Thursday made that abundantly clear. Just to remind you, it warned there has been almost no increase in the number of mortgages available at higher loans-to-value, and that the cost of home loans is increasing.

No wonder that the Council of Mortgage Lenders' figures show that mortgage lending actually fell back in May compared to the previous month. That reflects lower remortgaging activity, but also the fact that what increases we have seen in mortgage approvals for home purchases recently have been exceptionally modest.

Home loan providers are increasingly risk-averse, which is understandable given their realistic fears about bad debt. Whatever political pressure is brought to bear on lenders, including those with the taxpayer on their share registers, the supply of mortgage finance isn't likely to ease any time soon.

For that reason, it is hard to see any sustained recovery in the housing market for some time yet. The worst of the falls may be over, though plenty of analysts would not even be that optimistic, and we may see the odd month of house price rises (there have already been several, according to Nationwide and Halifax), but the storm has not yet passed over.

Sums up the dilemma for the bulls perfectly: WHERE THE F*CK ARE PEOPLE GOING TO GET THE F*CKING "MONEY" FROM??

House prices dipped in June as rising mortgage rates made it increasingly difficult for cash-strapped first-time buyers to secure home loans, according to new figures published today.

Asking prices dropped by 0.4 per cent in June after four consecutive monthly rises, figures from Rightmove, the property website show.

The asking price for the average home dropped by more than Â£1,000 to Â£226,436. However asking prices are still 6 per cent higher than the beginning of the year.

A shortage of property for sale has supported prices in recent months, but Rightmove says that, as mortgage lenders increase their rates and continue to demand large deposits from first-time buyers, sellers are being forced to price their homes more competitively to attract interest.

Many leading lenders have increased the rates on their fixed-rate deals in recent weeks, despite no change in the Bank of England base rate, which remains at a record low of 0.5 per cent.

New buyers who have not saved a deposit of at least 20 per cent are also prevented from taking out the most competitive deals.

There are fears that the increase in the cost of home loans could undermine the tentative signs of stabilisation in the plunging housing market. Figures from Halifax bank showed that house prices rose by 2.6 per cent in May, the biggest rise in one month for six years.

House prices have already fallen by 22 per cent since the market peaked in the autumn of 2007. Miles Shipside, the commercial director at Rightmove, said: â€œInterest rates for fixed-rate mortgages are now increasing, in line with money-market expectations of higher medium-term interest rates.

â€œProperty deals appear within the grasp of cash-strapped first-time buyers, but every rise in fixed rates frustratingly nudges them a bit further out of reach.â€

â€œLenders need to be wary not to choke off the recovery in affordability and activity by punishing the returning buyers with ever widening margins.â€

So banks are only wanting to lend to people with a high deposit. This is something I said would depress house prices. Seems like that's starting to happen.

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I have been holding back from buying a house in Cambridgeshire for the past year as the general sentiment amongst people who actually have a clue what is going on with the economy is that there are further falls to come.

My question is, if there is to be a huge spike in interest rates on mortgages, as a first time buyer am I better off buying now despite believing there will be further falls in house prices? Im struggling to weigh it up.

Thanks

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I have been holding back from buying a house in Cambridgeshire for the past year as the general sentiment amongst people who actually have a clue what is going on with the economy is that there are further falls to come.

My question is, if there is to be a huge spike in interest rates on mortgages, as a first time buyer am I better off buying now despite believing there will be further falls in house prices? Im struggling to weigh it up.

Thanks

You need to weigh up long term fixed rate on a large debt or high interest rates on smaller debt.

Which one will you pay out more money on? My advice is avoid the large debt.

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They will do in real terms over the next five years,same as you say the media don't want to admit it, because if all new buyers stopped buying and waited for the 40% off there would be no one to lose money only the lenders.

Yup...

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I have been holding back from buying a house in Cambridgeshire for the past year as the general sentiment amongst people who actually have a clue what is going on with the economy is that there are further falls to come.

My question is, if there is to be a huge spike in interest rates on mortgages, as a first time buyer am I better off buying now despite believing there will be further falls in house prices? Im struggling to weigh it up.